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Washougal joins effort to participate in tax credit program

The vote was 4 to 3

The Washougal City Council has narrowly approved an agreement that proponents hope will result in the addition of local jobs and economic development.

The vote last night was 4 to 3, in favor of authorizing Mayor Sean Guard to sign a professional services agreement to retain consultant Pilot Management Resources LLC. It involves the expenditure of $21,875.

The New Markets Tax Credit program involves an indirect federal subsidy for business and development investment. Tax credits are awarded through annual competitive applications, and awardees sell tax credits to investors. The U.S. Treasury awards $3.5 billion in credit authority each year.

Camas-Washougal Economic Development Association President Paul Dennis has said as part of the application process, three local projects would likely be submitted — one each from Camas, Washougal and the port.

Consultants Don Mazziotti and Stephen Brooks will help with the formation of a certified Community Development Entity, serve as guides through the first application process, and assist with the implementation of the tax credits — if a local project is selected.

CWEDA will serve as the lead agency, coordinating the consultant’s work efforts.

Prior to the Washougal council decision, Charlie Bishop, vice president of mill operations at Pendleton Woolen Mills, said he did not support the New Markets Tax Credit Program and spending $21,875 for it. He preferred the money be spent on maintaining streets or working on water or stormwater issues.

On April 15, Port commissioners voted 3-0 and on April 21 the Camas City Council voted 6-0 to enter into a professional services agreement with CWEDA. The port will pay $43,750, while Camas’ portion is $21,875.

Brent Erickson, executive director of the Camas-Washougal Chamber of Commerce, encouraged the Washougal councilors to vote for the tax credit program.

“The industrial park is in the city of Washougal,” he said. “Partner up for the greater good of Washougal. More businesses generate more taxes.”

Lindsay said there is no guarantee a local project would be approved and receive money from the Treasury Department.

“We’re in competition nationally,” she said.

Shoemaker opposes the federal government borrowing money for tax credits.

“It would be a gamble,” he said. “There is no guarantee of success.”

Freeman said she has talked to local residents and business people about the tax credits issue.

“I’m not a gambler, but I’m in favor of this, in order to see jobs and the quality of life improve,” she said.

Boger said, “the sooner we get our application in, the sooner we will see some results of this.”

Plinski said the “miniscule” expenditure of $21,875 could bring a huge opportunity for Washougal, resulting in jobs and tax revenue.

Greenlee said he had changed his mind several times, regarding the New Markets Tax Credit issue.

“It is a decent investment, a tool,” he said.

The New Markets Tax Credit Program, established by Congress in 2000, empowers the Treasury Department to grant tax credits to certain projects. For every dollar contributed by a qualified investor, there is a 39 cent credit that goes back to the investor — redeemable at the end of seven years.